Inyo County Rejects DWP’s Appeal of Tax Penalty : Government: Officials say snafu was within control of L.A. agency. Water department may sue to avoid paying $333,000.

The Los Angeles Department of Water and Power’s appeal of a $333,000 tax penalty was rejected Tuesday by Inyo County officials, who say the giant agency must accept blame for a mail-room snafu that led to the hefty late payment charge.

Inyo County tax collector John Treacy said he rejected the appeal because “the circumstances that caused the delinquent payments were within the city’s control. If the city had used reasonable care the tax payment would have been received on or before the delinquent date.”

DWP General Manager Dan Waters said the decision “doesn’t surprise me” and added that the agency is exploring other legal options to avoid the penalty.

In its 90-page appeal, the DWP said it made a good faith effort to meet the deadline for paying its $3.2-million tax bill for real estate it owns in Inyo County. It placed the blame on a series of errors by low-level mail-room employees.

Officials said the checks were written and forms filled out in time, but a student trainee filling in for the “regular guy” in the mail room put the wrong amount of postage on the envelopes.

Then, through a series of mishaps, the checks were left on a desk in the mail room for three days as the tax deadline passed.

The penalty is sizable for the DWP. But for Inyo County, where the DWP owns 30% of all taxable land, it is a windfall. Treacy said the money will be placed in the county’s general fund, where it is sorely needed.

In addition to Inyo, Waters said, the DWP makes 52 property tax payments in 18 counties in five states. Until the botched Inyo mailing, the agency had never missed a payment, Waters said.

From now on, he added, the accountants who write the tax payment checks will also be responsible for mailing them on time.